THE Federal Government said it is prepared to rejig the 2025 budget amid a slump in global oil prices and current tariffs imposed by the United States (U.S) President Donald Trump.
The Minister of Finance and the Coordinating Minister of the Economy, Wale Edun, hinted at this on Monday, April 7, in Abuja.
He gave information on the sidelines of the Ministry of Finance Incorporated (MOFI) governance scorecard meeting in Abuja, which was themed: ‘Ensuring Value Creation in State-Owned Enterprises Through Better Corporate Governance.’
Edun expressed worries that the government has to adjust, possibly, where necessary, its 2025 budget plans as a result of the global shift in Trump’s policies.
“We are monitoring developments globally, and we are adjusting accordingly. We’ll be speaking to the National Economic Council on this. It’s not our exclusive decision to make, however, we’ll make adjustments where necessary,” he said.
“Budget adjustment and prioritisation, where possible, as well as innovative non-debt financing strategies, would be embraced,” Edun said.
Adding that the government is planning adjustments in the budget to reflect the realities, the minister said, “We are also looking at opportunities and giving global companies opportunities to make more money, while they invest in Nigeria.This is why we are intensifying efforts to ensure our corporate governance structure is top-notch to attract more private capital into our infrastructure financing.
The ICIR reported that U.S. President Trump slapped a 14 per cent tariff on Nigerian exports, arguing that Nigeria had already imposed a 27 per cent tariff on U.S. exports to the country.
He, however, exempted oil and minerals-related exports from the new tariff.
Trump also imposed a 34 per cent tariff on China’s exports to the U.S.; the country is Nigeria, a major trading partner, and 31 per cent on South Africa, Nigeria’s economic rival in Africa.
The new tariffs announced on Wednesday, April 2, which came with immediate effect, affected over 50 countries, including major trade partners such as China, the European Union (EU), India, and Japan, along with developing economies across Asia, Africa, and Latin America.
Trade statistics
Nigeria-U.S. trade statistics have been in surplus in the last 3 years (2022-2024).
The minister noted that Nigeria’s exports to the U.S. were N1.8 trillion, N2.6 trillion, and N5.5 trillion in 2022, 2023, and 2024, respectively.
Fortunately, oil and mineral exports accounted for 92 per cent, implying that oil and minerals exports amounted to N5.08 trillion in value, while non-oil exports were just N0.44 trillion.
“Consequently, the tariff effect on exports is negligible if we sustain our oil and minerals export volume,” Edun said.
U.S. tariffs’ effect
According to Edun, the adverse effect of the new tariff on Nigeria will be through the oil price plunge.
On Friday, April 4, Brent crude oil price fell to $65.58 per barrel for the first time in four years.
This could be a setback for the Nigerian 2025 budget, which will most likely face implementation challenges with the consistent drop in crude oil price, The ICIR reported.
President Bola Tinubu had on February 28 signed the 2025 budget of N54.99 trillion, which shows a crude oil budgetary benchmark price of $75 per barrel, a 2.06 million barrels per day (bpd) production target at an exchange rate of N1,500 per dollar.
His lead administration is targeting N34.8 trillion in revenue to fund the budget, of which the bulk of the revenue will come from crude oil proceeds.
He projects that crude oil will bring in N19.6 trillion in revenue, while non-oil sources would come in at N15.22 trillion.
But with Nigeria far from meeting its crude oil output benchmark and falling price in crude oil prices, the proper implementation of the 2025 budget appears gloomy.
In his submission to these worries, Edun added, “We are intensifying efforts to ramp up crude oil production to curtail any price effect.
“We are also focusing on non-oil revenue mobilisation by FIRS and Customs.”